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Dr Maganlal Motichand Chandaria Insight Into Building A Business Empire

Dr Maganlal Motichand Chandaria Insight Into Building A Business Empire


 

 

 

 

 

 

 

 

BY JAVED KANA

Dr Maganlal Motichand Chandaria is the founder and own- er of the Chandaria Group of Companies; he has interests in banking, real estate and petroleum industries.
Dr Chandaria was bestowed upon an Honorary Degree of Doctor of Science, Honoris Causa, in recognition of his philanthropic and humanitarian activities. Previously, the United Graduate College & Seminary International, USA honoured him with a degree in humanities and he also received an OGW from the President of Kenya for his distinguished service.

At 96, Dr Chandaria is still an active entrepreneur, although he has now given the reigns of the business to his children, he pays regular visits to his companies. His focus, however, remains charity. ‘If someone comes to me, he will not go back empty-handed,’ states Dr Chandaria. In this interview, we trace Dr Chandaria’s journey from his humble beginnings in India, to his migration to Kenya and how he became a business mogul.

 

You were born in India in 1924, but moved to Kenya nine years later. What was life like growing up?
I was born in a very small village, Ravalsar, near Jamnagar which then had only about 200 people. I had to go walking to the nearby town to attend the school. My mother’s family – Bhag- wanjibhai and brothers were based in Kenya. She decided to send me to Kenya at the age of nine, so I could stand on my feet. I landed in Mombasa and stayed with my maamas (ma- ternal uncles). I studied in the coastal town for three years before deciding to do ‘some- thing for the family.’ I never went to secondary school. When I think about my past now, I can’t imagine, having held the position of a director of Deposit Protection Fund (now Kenya Deposit Insurance Corporation) which is part of Central Bank of Kenya for a term of three years, I was the first person to be taken on the board from the private sector banks.

Was it easy staying away from your parents, in a foreign land with your uncles?
In the beginning, it was not too easy for me. At the same time, my uncles – Bhagwanjibhai, Somchandbhai and Raichandbhai, never treat- ed me differently from their children. What I am today is because of my uncles. After leav- ing school, I joined my uncles’ business – Bhag- wanji & Company Limited, for a few years in Nairobi before being transferred as the Manager for their Mombasa branch. After a few years, I ventured out to do my own business since it was my dream to be a businessman.

What was the first business you ventured into?

You won’t believe it, my first business was es- tablished at a premise measuring 10 by 10 feet. I started by selling sweets to school children. Later, I ventured into the transport, clearing and forwarding businesses. Subsequently, I struck success venturing into the business of making straws. Back in those days, drinking with a straw was considered a luxury.After acquiring machinery from the UK, I set up a factory for man- ufacturing drinking straws. For the first six months, I struggled to manufacture straws and was unsuccessful. I thought the suppliers had conned me. So, I sought guidance from them and the business kicked off. I became a pioneer in man-
ufacturing straws locally. I started making good profit. At the same time, I also realised
that it was a small market and there was no growth. Then came the idea of mak- ing toilet rolls. There was a potential market for toilet rolls, because at the time, the consump- tion of toilet paper was not as much. I couldn’t afford to buy new machinery; so I settled in for a second-hand machine from abroad which then cost me Kshs 30,000. I used to import big rolls of tissue paper, cut into the respective sizes and remarket them. I was the first person in this business those days. No- body used to locally produce tissue. Eventually, I went ahead to manufacture tissue paper local- ly. It struck my mind that it was not necessary to cut trees as one could recycle paper. Again, I was the first one to do so.

But the success of Chandaria Industries did not see you content. You ventured into many businesses after.

So many, indeed! I started businesses in India and UK. My elder son, Dinesh Chandar- ia was the brain be- hind several businesses ventures of mine. Everything was going steady for us. But Dinesh died at the prime age of 52, following a three-day illness. That was the biggest setback for me and the family. Had Dinesh been alive today, I can’t imagine how high our businesses would have soared. He had an extremely sharp mind with a great business sense. It was destiny that he is not with us now.
In his honour, Dinesh’s sons, Amit, Hetul and Bhavnish have formed “DMC Group (Dinesh Maganlal Chandaria) Group of Companies.” The companies under this Group are East African Paper Mills, Transafrica Paper mills, Guardian Bank Limited, Global Petroleum Products (k) Limited, Chandaria Commodities Limited, DMC Properties, ChandariaProperties (EA) Limited. The Group also has established Dinesh Maganlal ChandariaFoundation.

I started many businesses in India and UK. In Kenya, I used to struggle to get cartons to package the tissue rolls. At the time, there was only one company manufacturing cartons. The owners of this company used to frustrate me so much by not supplying cartons in time. Since I knew a number of carton industries in India, I decided to seek information from them so as to manufacture cartons locally. They agreed to help me to set up carton manufacturing businessin Kenya. The management of the existing carton supplier heard about it and tried their best to shut down my business. I challenged them by saying, “Let me tell you one thing, if I have the strength to import the machinery, I also have the strength to dump it into the sea. If I don’t succeed, I will dump it in the sea… but I will not stopmaking cartons.” The cartons business too was a great success.

What spurred your interest in banking then?

One of my friends had a banking license and he approached my son, Dinesh with a proposal. We felt it was the right time to enter the financial sector. This gave birth to Guardian Bank Limited in the year 1996. Since then, the bank has grown from strength to strength. Today we have nine branches spread over in all the major towns of the country extending best services. I initiated to bring together the owners of majority of the small and me- dium-size banks and formed an informal group for which I was the Chairman for about 15 years. We used to meet regularly to discuss and exchange ideas on various issues affecting the banking sector in gen- eral and the small and medium size banks in particular. Banking is a prestigious and very competitive sector in Kenya.

Started over four decades ago, the Chandaria Group of Companies reportedly controls 70% of the paper industry in Kenya. What have been some of the challenges you have overcome in building your business dynasty?

The biggest problem in the beginning for me was finance. I started my business in Mombasa, in a hired premises. We used to save every penny. I used to work hard and for long hours. Fi- nance is an important component for any business. I, as business- man, and the family, had a reputed name so I used to get the finances needed from the banks. Beyond finance, other challeng- es also lie in the knowledge of the industry one is venturing into. When I started off, whether it was manufacturing straws or tissue paper, it was important for me to gain knowledge of the respective industry. I also feel, marketingis a big component to the success of any business. We succeeded because we managed these key components well.

According to Forbes magazine, less than 50% of businesses do not successfully transition from the first to second generation and less than 30% of businesses do not make it to the third genera- tion. How have you addressed the succession plan and transition plans to move from strength to strength? What has been the key for your success?

I make it a point to meet with my children regularly to discuss setbacks and successes and to explore the emerging trends in the business. We discuss opportunities and my advice to them is to consider expansion of the businesses. The key success for the growth of the businesses is that my children/grand children have taken keen interest in the business, from day one. I advise them to never be proud. I haven’t been to secondary school but I read many books and magazines to broaden my knowledge. Reading is important.

You have been feted with numerous accolades, in- cluding an Honorary Doctorate Degree from Moi University and the Order of the Grand Warrior by President Uhuru Kenyatta, among others. What do such recognitions mean to you?

(Laughs) I feel humbled and honoured to have received an honorary degree from Moi University, recently. I am one of the few who have been recognised for this honour since the establishment of the University. Getting the OGW from the President is also a big achievement.
My contribution towards the Banking In- dustry has been recognised by awarding me ‘Life Time Achievement Award’ by Think Business during the year 2014. The Oshw- al Community awarded me the ‘Life Time Achievement” award at the Oshwal Awards 2018 for my contribution to the communi- ty/society. These acknowledgements fuel my motivation to do more to help the society. Pres- ently, I am one of the three Trustees of the Oshwal community. I have been continuously donating to vari- ous social causes, more particularly towards education and hospitals.

That brings me to your humanitarian work. You founded The Magan Chandaria Charitable Trust, to give back to the community, a practice many successful businessmen do till today. What compels you to continuously and generously give back to society?

This is my policy – if God gives you some- thing, you are not the only owner of it. You must spend it well but you must look af- ter other people, more particularly the less fortunate. I am running a school in Ruaraka, opposite my factory. It was a government school but I used to look af- ter it. I built classrooms and bought sta- tionery. The City Council, recognised my charities, and named the school after me – MM Chandaria Primary School.

At over 94 years old, you remain active in your daily life – from going to work to volunteering your time in the community in various capacities. How do you manage such a lifestyle?

I am the Chairman of the group companies and keep myself abreast in respect of all my group companies. The day-to-day affairs of the group companies are managed by my grandchildren and I am really proud of their involvement and achievements. I follow a set routine – I wake up at 6.30am. Until 10.00am, I am at home. Then, I go to the temple and during my free time, I go through the management reports from the group com- panies. I spend about an hour daily in the office. By 8.30pm, I am in bed.

You are an inspiration to many upcoming entrepreneurs. What’s your advice to them?
Sincerity and honesty should be the primary goal of every individual. Don’t pinch anyone’s penny. It will not last with you. Only hard work pays. Have a passion for it.

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